AUSTIN - Construction on a five-story building with high-end office space that will replace the former Bank of America annex has started. The project, at 501 Congress Ave., will be built at a cost of more than $30 million.

The project will transform the existing vacant annex, which was in 1964, into 116,000 sf of "boutique" office space — the type most coveted by technology and "creative-class" companies.

Demolition work is underway to gut the existing building and give it a floor-to-ceiling makeover. In addition to the office space, the building will have more than 12,000 sf of restaurant and retail space.

An eight-story parking garage with 312 spaces will be built behind the building after an existing valet parking garage is razed.

The project is part of a tide of new development sweeping downtown east of Congress, where a number of hotels and apartment towers have opened, are under construction or are in the planning stages.